18Dec15

Deputy Finance Minister: Ukraine has no chance to win lawsuit on $3 bln debt to
Russia

Ukraine stands no chance to win lawsuit on its $3 bln debt to Russia, Deputy
Finance Minister Sergey Storchak said on Friday.

"As soon as the non-payment fact is easily established by the British court this
will mean a very quick and specific procedure on taking a final decision. In this
respect, Ukrainian colleagues as potential participants of a legal proceeding have
no chance to win it," Storchak said, admitting though that the court's
pronouncement will be followed by the issue of execution of the court ruling, but
"that is another issue."

Earlier on Friday Ukraine's Cabinet imposed moratorium on payment of the
Russian debt. Ukrainian government also imposed moratorium on the payment of
$507 mln by 2 Ukrainian companies to Russian banks.

In December 2013, Russian President Vladimir Putin and the then Ukrainian
President Viktor Yanukovych reached an agreement that Moscow would extend a
15 bln U.S. dollar loan to Kiev through placing Ukrainian securities. Under the
deal, $3 billion worth of bonds were listed on the Irish Stock Exchange on
December 20, 2013 and acquired by Russia using the funds from its National
Welfare Fund.

Later on, Ukraine tried to challenge the loan's status and reduce it to that of
commercial credits subject to restructuring. Russia objected to this approach.

In November 2015, Putin said Russia was ready to restructure Ukraine's debt in
case the United States, the European Union or any big international financial
institute gave its guarantees to Russia. No guarantees were granted.

On December 17, the International Monetary Fund's board recognized the official
status of Russia's $3 billion loan to Ukraine.

The deadline for repayment of the Ukrainian debt is December 20. In the event it
fails to do that, Russia will go to law ten days after that date.

[Source: Itar Tass, Moscow, 18Dec15]

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